JSEL SECURITIES LTD., Jaipur V. INCOME TAX OFFICER, WARD-6-1, Jaipur

ITA 631/JPR/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 4716 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 2 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-08-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 09-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJENDER SINGH DHK
• Section: 143(3)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ T;IQJ U;K;IHB] T;IQJ T;IQJ U;K;IHB] T;IQJ T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH JESK LH-'KEKZ] YS[KK LNL; DS LE{K BEFORE : SHRI RAMESH C.SHARMA, ACCOUNTA NT MEMBER VK;DJ VIHY LA-@ ITA NO. 631/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2013-14 M/S. JSEL SECURITIES LIMITED JAIPUR STOCK EXCHANGE BUILDING JLN MARG, MALVIYA NAGAR, JAIPUR CUKE VS. THE ITO WARD- 6(1) JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AAACJ 9169 L VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY :SHRI MANISH AGARWAL, CA JKTLO DH VKSJ LS@ REVENUE BY: SHRI RAJENDER SINGH, ADDL. CIT-DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 01/08/2019 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 05 /08/2019 VKNS'K@ ORDER PER RAMESH C. SHARMA, AM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF THE LD. CIT(A)-2, JAIPUR DATED 12-03-2018 FOR THE ASSESSM ENT YEAR 2013-14, IN THE MATTER OF IMPOSITION OF PENALTY U/S 271(1)( C) OF THE ACT. 2.1 THE FACTS IN BRIEF ARE THAT THE ASSESSEE IS A L IMITED COMPANY AND FILED ITS RETURN OF INCOME ON 29-09-2013 DECLARING TOTAL LOSS OF RS. 22,98,582/-. THE ASSESSMENT HAS BEEN COMPLETED U/ S 143(3) OF THE ACT WHEREIN LOSS WAS REDUCED TO RS. 18,44,473/- BY MAKI NG ADDITION OF RS. ITA NO.631/JP/2018 JSEL SECURITIES LTD VS ITO, WARD-6(1), J AIPUR 2 3,54,109/- ON ACCOUNT OF INTEREST ON INCOME TAX REF UND AND ANOTHER ADDITION OF RS. 1.00 LAC ON LUMP SUM BASIS BY PRESU MING INCREASE IN RECEIPT OF INTEREST BY THE ASSESSEE. WITH RESPECT T O THE ADDITION OF RS. 3,54,109/-, THE AO ALSO LEVIED PENALTY OF RS. 1 ,09,420/- U/S 271(1) ( C) OF THE ACT 2.2 BY IMPUGNED ORDER, THE LD. CIT(A) CONFIRMED THE ACTION OF THE AO LEVYING PENALTY OF RS. 1,09,420/- U/S 271(1)( C) OF THE ACT AGAINST WHICH THE ASSESSEE IS IN APPEAL BEFORE THIS BENCH. 2.3 I HAVE HEARD THE RIVAL CONTENTIONS CAREFULLY AN D GONE THROUGH THE ORDERS OF THE LOWER AUTHORITIES AND FOUND FROM THE RECORD THAT DURING THE YEAR UNDER APPEAL, INTEREST TO THE TUNE OF RS. 3,54 ,109/- HAD ACCRUED TO THE ASSESSEE AS INTEREST ON INCOME TAX REFUND GRANTED U /S244A OF THE I.T. ACT, 1961 FOR AYS 2009-10 TO 2011-12. HOWEVER, THE SAID INCOME TAX REFUNDS WERE NEITHER RECEIVED BY THE ASSESSEE (I.E. CREDITE D IN THE BANK ACCOUNT OF THE ASSESSEE) NOR ANY INTIMATION WAS RECEIVED REGAR DING GRANTING OF ANY SUCH REFUND OR ADJUSTMENT OF SUCH REFUNDS AGAINST A NY TAXES DUE ON THE PART OF ASSESSEE. THE FACT OF GRANTING OF SUCH REFU NDS AND INTEREST THEREON WAS BROUGHT TO THE KNOWLEDGE OF THE ASSESSEE ONLY D URING THE ASSESSMENT PROCEEDINGS WHEREIN IT WAS INTIMATED TO THE ASSESSE E THAT SUCH REFUNDS WERE GRANTED TO IT AND ALSO THAT SUCH REFUND ALONGW ITH INTEREST THEREON ITA NO.631/JP/2018 JSEL SECURITIES LTD VS ITO, WARD-6(1), J AIPUR 3 WERE ADJUSTED AGAINST OUTSTANDING INCOME TAX DEMAND PERTAINING TO THE PRECEDING ASSESSMENT YEARS. THUS NO INTIMATION OF S UCH APPROPRIATION / ADJUSTMENT WAS GIVEN BY THE DEPARTMENT TO ASSESSEE AND, THEREFORE, THE RECEIPT OF INCOME TAX REFUND AND INTEREST WAS NOT E VEN IN THE KNOWLEDGE OF THE ASSESSEE. THIS FACT WAS SUBMITTED BEFORE THE AO AS WELL AS LD. CIT(A) DURING THE COURSE OF PROCEEDINGS VIDE LETTER DATED 25-07-2016 AND WRITTEN SUBMISSIONS DATED 11-12-2017 RESPECTIVELY. WE FOUND THAT WHEN THE ASSESSEE WAS NOT EVEN AWARE OF EITHER THE GRANT OF INCOME TAX REFUND OR THE INTEREST THEREON AS THE SAME STOOD ADJUSTED BY THE DEPARTMENT AGAINST THE OUTSTANDING DEMAND OF PRECEDING ASSESSM ENT YEARS WITHOUT ANY INTIMATION TO THE ASSESSEE, THERE AROSE NO QUES TION OF DECLARING THE INTEREST ON SUCH REFUNDS IN THE COMPUTATION OF INCO ME. HENCE, NO PENALTY COULD HAVE BEEN IMPOSED FOR THE FAILURE ON THE PART OF THE DEPARTMENT TO INTIMATE ACCRUAL OF SUCH REFUND AND THE TOTAL INTER EST THEREON AS WELL AS THE FACT THAT THE SAME HAS BEEN ADJUSTED AGAINST SOME E ARLIER TAX DEMANDS. THUS, AS THE ASSESSEE HAD ACTED BONA FIDE AND DECLA RED THE TRUE INCOME IN ITS RETURN OF INCOME ACCORDING TO ITS BELIEF, QUEST ION OF EITHER CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS OF INCOME D OES NOT ARISE, IN FACTS AND IN CIRCUMSTANCES OF THE CASE. IN VIEW OF THE AB OVE DISCUSSION, WE DO ITA NO.631/JP/2018 JSEL SECURITIES LTD VS ITO, WARD-6(1), J AIPUR 4 NOT FIND ANY MERIT FOR THE IMPOSITION OF PENALTY B Y THE AO. ACCORDINGLY, WE DIRECT THE AO TO DELETE THE PENALTY. 3.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED ORDER PRONOUNCED IN THE OPEN COURT ON 05 /08/2019 . SD/- JESK LH 'KEKZ (RAMESH C. SHARMA) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 05/08/ 2019 *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- M/S. JSEL SECURITIES LTD. JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- THE ITO, WARD- 6(1), JPR 3. VK;DJ VK;QDRVIHY ) @ CIT(A), 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.631/JP/2018) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR